International Conference Focuses on Digital Economy
Conferences
09.08.2019
17th ZEW Conference on the Economics of Information and Communication Technologies
Around 90 international researchers came to ZEW in Mannheim to discuss current scientific questions concerning the digital economy. On 27 and 28 June 2019, ZEW hosted the 17th conference on the “Economics of Information and Communication Technologies” organised by the ZEW Research Department “Digital Economy”. The conference has long been considered one of the most important international scientific conferences in the field of digital economy.
The first keynote was delivered by Professor Catherine Tucker from the MIT Sloan School of Management, who focused on the topic of algorithmic decision-making in the context of digital platforms. Today, algorithms – in particular in the form of machine learning – are widely used in online search engines, social networks and comparison websites. Examples for algorithmic decision-making include product recommendations on platforms like Amazon, and last-minute auctions for Google and Facebook ads. The results created with the help of machine learning seem, however, to be distorted in individual applications. In her presentation, Catherine Tucker provided possible reasons for this statistical discrimination from an economic perspective.
For example, researchers conducted a field experiment to test the algorithm used for ads on a digital platform. The aim of this algorithm was to make job offers available to users from the fields of mathematics, engineering, technology and natural sciences, and to ensure that these offers are distributed in a gender-neutral way. At the end of the field phase, the researchers discovered, however, that the ad was displayed less frequently to women than to men. This is due to the fact that young women are highly sought after as a target group, making ad placements for them particularly expensive. So what appears to be statistical discrimination instead has its roots in the algorithm’s ability to optimise the cost efficiency of ad placement.
The second keynote speech focused on the question of how the analysis of data from the internet can help generate new insights into market mechanisms, consumer behaviour and competition. Providing an example of this development, Professor Liran Einav of Stanford University presented the findings of a study he conducted on the basis of data from the online market place eBay. In order to analyse consumer behaviour, he used the fact that sellers on eBay often have multiple listings for identical items, while varying the asking price for an auction. Liran Einav emphasised that while these new and sometimes large quantities of data bear a great potential for empirical economic research, they cannot replace well-founded economic theory nor precise econometric research design.
Conference covers broad range of topics related to the digital economy
In several parallel sessions, the conference provided many different perspectives on the digital economy. The contributions presented at the conference covered a broad spectrum of topics, ranging from social media and the sharing economy, to online advertising and the application of machine learning. This year, the event also focused on user behaviour on the internet, the impact of digitalisation on political mobilisation as well as the change of market structures. In addition, Florian Stahl and Martin Peitz, professors at the University of Mannheim, organised two sessions on strategic behaviour in the context of digital platforms. The conference featured a total of 41 presentations and subsequent discussions, and received funding from the German Research Foundation (DFG).
